ACCC delays approval to Link Group’s (ASX:LNK) proposed acquisition

Highlights

• ACCC has delayed review of proposed acquisition by Dye & Durham Corporation.
• Dye & Durham provides cloud-based software technology and services to its large client base.
• Dye & Durham proposed the acquisition of Link Group in December 2021.

The competition regulator Australian Competition and Consumer Commission (ACCC) has delayed a decision on the proposed $2.9 billion acquisition of share registry company Link Group (ASX:LNK) by Canadian group Dye & Durham. This has added to worries about whether the deal will be completed in its current form. that it has extended the review of a proposed acquisition by Dye & Durham Corporation (D&D).

The decision on the acquisition has been pushed to 16 June 2022.

The board of Link group unanimously recommended the shareholders to vote in favour of the transaction.

The shares of Link Administration ended 0.92% lower than the previous close at AU$4.30 per share. LKN shares have declined nearly 12% in the last one month and by 23% year-to-date. In a year, the shares dropped by 15.59%.

Noteworthy here is that Link shares have performed in line with the benchmark index ASX All Technology (XTX), which fell 1.75% today.

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Details about the proposed acquisition by Dye & Durham

On 22 December 2021, Link informed its shareholder that it had inked a scheme implementation deed with D&D, under which the Canadian group will acquire a 100% share of Link. As a part of the transaction, Link shareholders would receive AU$5.50 per share along with an interim dividend of 3 cents per share.

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Link has an approximately 43% stake in PEXA, an online property exchange network in Australia. As part of the acquisition proposal, D&D will also buy the stake in PEXA.

On 1 March 2021, ACCC began with the market inquiries related to the proposed transaction. In the market inquiry announcement, ACCC said that it focuses on the impact on competition. In addition to this, the regulator is seeking views from the market if their ability to compete is affected in any way by the proposed deal.

About Dye & Durham

D&D offers cloud-based software solutions designed to increase productivity and improve efficiency for legal and business professionals. Clients use the critical information services offered by D&D to manage their regulatory requirements, information and process. The blue-chip customer base of D&D majorly includes financial service institutions and government organisations.

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About Link Group

Link Administration Holdings is an ASX-listed software and services company that connects people with their assets, such as investment properties, equities, superannuation and so on. Link Group makes the scaled administration simpler by partnering with financial market participants to deliver solutions and services to its client base.